Published: Mon, March 12, 2018
Money | By Armando Alvarado

Retail Inflation Eases To 4-Month Low; Industrial Output Soars To 7.5%

Retail Inflation Eases To 4-Month Low; Industrial Output Soars To 7.5%

On the other hand, the cumulative growth in these three sectors during April - January 2017-18 over the corresponding period of 2016 - 17 has been 2.5 percent, 4.3 percent and 5.3 percent respectively.

As per the use-based classification, the growth rates in January 2018 over January 2017 are 5.8 per cent in primary goods, 4.9 per cent in intermediate goods, and 6.8 per cent in Infrastructure/ Construction Goods.

Shoppers ride escalators inside a store at a mall in Mumbai, India, July 10, 2017.

The annual retail inflation fell to a 4-month low of 4.44 per cent in February, as food prices fell, government data showed on Monday.

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The general index for the month of January 2018 stands at 132.3, which is 7.5 percent higher as compared to the level in the month of January 2017. The decline was supported by a sharp moderation in vegetable inflation to 17% in February 2018 against 27% in January 2018 and a continuous dip in pulses and products inflation. In terms of actual outcomes, headline inflation averaged 4.6% in Q3, driven primarily by an unusual pick-up in food prices in November.

The IIP growth in January this year was mainly on account of up-tick in manufacturing sector which constitutes 77.63 percent of the index.

Major indicators of CPI eased down in the February 2018 month, with food & beverages at 3.38%, pan, tobacco & intoxicants at 7.34%, clothing & footwear at 5%, housing at 8.28%, fuel & light at 6.68% and miscellaneous at 3.85%. In January, retail prices of vegetables rose almost 30%. The consumer durables sector saw growth accelerating sharply to 8% from 0.86% over the same period.

The deceleration in CPI inflation will nudge the Reserve Bank of India (RBI) to hold off on hiking key repo rates as it sounded hawkish at the Monetary Policy Committee (MPC) meeting last month. In all 16 out of 23 industry groups in the manufacturing sector showed growth in January. It also estimated the retail inflation for 2018-19 in the range of 5.1-5.6 percent during April-September and 4.5-4.6 percent in the second half of the year.

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